It seems like a quaint notion today, but when Toyota launched the Lexus brand in 1989, one of the central issues it faced was whether Americans would even consider a Japanese luxury brand.
The answer was an emphatic yes.
-In fact, the original price target for the LS 400 was even less — around $25,000 — but the yen-dollar exchange rate forced the higher price.
"Most of the luxury market was between $25,000 and $30,000, and half of that was Cadillac and Lincoln. So we felt we had to come in at $25,000," says Dave Illingworth, the first Lexus Division general manager after the brand was launched.
"But the yen appreciated (against the dollar) from 150 to 115, and suddenly we're riding above $30,000. I was wondering how we were going to sell 40,000 of them for the dealers to make money. When it finally came in at $35,000, everyone was screaming bloody murder. But there was no looking back," says Illingworth, now senior vice president, chief planning and administrative officer for Toyota Motor Sales U.S.A.